Elon Musk’s space exploration company SpaceX has entered into a $17 billion purchase agreement with EchoStar to purchase its rights and licenses for frequency bandwidth of 50 MHz on its S-band spectrum, coupled with some of its spectrum licenses, as per an official announcement by SpaceX and an 8K filing by EchoStar.
The purchase agreement specifically will be targeting the following frequency ranges: 2000-2020, 2180-2200, 1915-1920, and 1995-2000.
SpaceX’s official announcement says that the agreement will help it expand its broadband network for cell phones, an initiative it started in January 2024 to help it reach areas with no reception.
To secure the purchase, The space exploration company will pay off some of EchoStar’s debt obligations, mainly its Senior Spectrum notes, which are due in 2029 and 2030. SpaceX will also pay off $8.5 billion using its Class A Common Stock at a share price of $212. Any remaining amount to be paid after stock compensation and paying off EchoStar’s debt obligations will be paid in cash, as per the official 8-K filing.
SpaceX is still a privately held company and does not trade on an exchange. It was founded in 2002.
Source: Google Finance
After SpaceX agreement, EchoStar shares go up 19.91%
EchoStar shares closed on Monday at a price of $80.63, up by 19.91%. After-hours trading showed the stock shoot up by another 2.38% to $82.55.